How My Start-up Started Over
March 27, 2013 § Leave a comment
In my last post I wrote about why I shut down my last product after only 3 months. At that point, I had a decision to make – Give the remaining money back to investors (~25 cents on the dollar) or Start the process over. I gave myself a few weeks to find a pain that needed solving or I would give the money back. At least that’s what I told myself. Realistically, since I never give up, I likely would have given myself more time. But the time pressure helped (as it always does) and within a few weeks, we landed on a problem that needed solutions. Here is the process we took to get there.
Step 1: Define the rules
The first thing I did was re-read Paul Graham’s well written blog post on how to pick a start-up idea. It is very long, so I will summarize it for you:
Solve a problem that you have (ie Dropbox example – lost USB card)
Turn off the filter “could this be a huge idea / will this market be huge”, while being cognizant of business realities (ie AirBnb example)
Crowded markets aren’t necessarily bad idea areas
Founder has to strongly empathize with the product
Build something that people will pay you for / revenue is a true test
Design – solve a pain point and users can look past less-than-great designs for first versions – ship fast – focus on UX over design
Strip down to core product and the pain point it solves – bells & whistles can come from user feedback
I liked it so much that I required the entire team to read it. We then had a conversation about it and agreed that these would be our rules to live by. Anyone on the team can call Bull Shit if we strayed from these rules. We wrote them down on the white board and also emailed them out to everyone.
Step 2: Ideate
With the guidelines set, we all started brainstorming. Everyone had a day to go away and think about pains that needed solving so long as it adhered to these rules. You might be thinking “is a day enough time?” Yes it is. If you can’t figure out within a day a problem that needs solving, then it is not a big pain. Start-ups should only focus on big pains.
The next day, everyone got back together and pitched their ideas. It was kinda like American Idol, where I was Simon. Everyone got 2 minutes to pitch and we gave feedback.
This process was ok, but not perfect. The reality is that any idea had to fit rule #4, meaning, I had to strongly empathize with the product. This reality proved to be frustrating to some team members. Some felt it was a waste of time “to just do what Steven wants to do!” That was a fair criticism, but the process ended up productive.
Killing Good Ideas
We had some very good ideas that ended up getting killed because I couldn’t answer “Yes” to the question “would I hire me to be CEO of that company?” One example was the suggestion that we build a product that helps women get professional coaching on what to wear based on what’s in their closet. Seems like a good idea to me, however, since my wife buys all of my clothes and I wear jeans every day, I don’t think that I belong running a clothing consulting company. Maybe Julie could run it. But she already has a very important job running our family.
The Point of Rule #4
There are very important reasons that rule #4 is there. The reality of any start-up is that:
- Founders are the Chief Evangelist. If a founder can’t sell the product, no one can.
- No one stays awake at night thinking about the product/team/business/cashflow like a founder does.
- Unlike employees, Founders never leave unless they are booted out by the Board, and that is rare.
The Process was Not Completely Useless
While this process frustrated some, it actually proved to be productive. Not coincidentally, Noah (our VP of Engineering) and I came to a similar idea. We also found a few other ideas that fit the rules and merited further research.
Step 3: Customer Research
After narrowing it down to two ideas, we set out to get customer feedback and validate the pain point. We tried to include as many team members in this process as possible. Many teammates joined calls or went out and talked to customers. We reported on our results to the team and kept debating the merits.
Validate with Investors too!
I also included my lead VC (and Board Member) in the discussions. I wanted to know her opinion. Doesn’t make sense to start an un-backable company. Ellie correctly steered me away from one business idea and provided good feedback throughout.
Step 4: Time to MVP
The customer interview process proved fruitful, and by the end of December, we felt good that we identified a pain that needed solving (not coincidentally Noah’s and my joint idea). We also had a rough idea what a solution looked like. We took the last week of December off completely and came back in January ready to build an MVP. I will get into that process in the next post.